TESTBANK Edexcel A-
Level Economics LATEST
2024/2025 WITH
QUESTIONS AND
VERIFIED CORRECT
ANSWERS GRADED A+
GUARANTEED PASS
Allocative efficiency - ANSWER-Where the price of a
good is equal to the price consumers are willing to
pay. This occurs when all resources are allocated
efficiently.
Asymmetric information - ANSWER-Where buyers
have more information than sellers in a market, or
vice versa.
,Automatic stabilisers - ANSWER-Parts of fiscal
policy that automatically react to changes in the
economic cycle.
Average Cost (AC) - ANSWER-The cost of
production per unit of output.
Average Revenue (AR) - ANSWER-The revenue per
unit sold.
Backward vertical integration - ANSWER-Where a
firm merges with or takes over a firm further back in
the production process.
Balance of payments - ANSWER-A record of the
international transactions of an economy.
Bank rate - ANSWER-The official rate of interest set
by the central bank (e.g. by the Monetary Policy
Committee of the Bank of England)
Barriers to entry - ANSWER-Potential difficulties that
make it hard for firms to enter a market.
Barriers to exit - ANSWER-Potential difficulties that
make it hard for firms to leave a market.
,Black market - ANSWER-Economic activity that
occurs without taxation and government
intervention.
Budget deficit - ANSWER-When government
spending exceeds tax revenues.
Budget surplus - ANSWER-When tax revenues
exceed government spending.
Capital account of the balance of payments -
ANSWER-A part of the balance of payments that
shows transfers of non-monetary and fixed assets
into and out of the economy.
Cartel - ANSWER-A group of products who collude
to limit output in order to keep prices high.
Central bank - ANSWER-The institution responsible
for issuing banknotes in an economy, acting as a
lender of last resort, and implementing monetary
policy.
Ceteris paribus - ANSWER-All other things
remaining equal
, Circular flow of income - ANSWER-The flow of
national output, income and expenditure between
firms and households.
Command economy - ANSWER-An economy where
only the government determines the allocation of
resources.
Comparative advantage - ANSWER-When the
opportunity cost of producing a good or service is
lower than that of any other country.
Competition policy - ANSWER-Government policy
aimed at reducing monopoly power in order to
increase efficiency and to ensure fairness for
consumers.
Concentration ratio - ANSWER-A measure of the
dominance of firms in a market.
Conglomerate integration - ANSWER-Where a firm
merges with or takes over a firm in a completely
different market.
Consumer surplus - ANSWER-The difference
between the price a consumer pays and the price
they were willing to pay.
Level Economics LATEST
2024/2025 WITH
QUESTIONS AND
VERIFIED CORRECT
ANSWERS GRADED A+
GUARANTEED PASS
Allocative efficiency - ANSWER-Where the price of a
good is equal to the price consumers are willing to
pay. This occurs when all resources are allocated
efficiently.
Asymmetric information - ANSWER-Where buyers
have more information than sellers in a market, or
vice versa.
,Automatic stabilisers - ANSWER-Parts of fiscal
policy that automatically react to changes in the
economic cycle.
Average Cost (AC) - ANSWER-The cost of
production per unit of output.
Average Revenue (AR) - ANSWER-The revenue per
unit sold.
Backward vertical integration - ANSWER-Where a
firm merges with or takes over a firm further back in
the production process.
Balance of payments - ANSWER-A record of the
international transactions of an economy.
Bank rate - ANSWER-The official rate of interest set
by the central bank (e.g. by the Monetary Policy
Committee of the Bank of England)
Barriers to entry - ANSWER-Potential difficulties that
make it hard for firms to enter a market.
Barriers to exit - ANSWER-Potential difficulties that
make it hard for firms to leave a market.
,Black market - ANSWER-Economic activity that
occurs without taxation and government
intervention.
Budget deficit - ANSWER-When government
spending exceeds tax revenues.
Budget surplus - ANSWER-When tax revenues
exceed government spending.
Capital account of the balance of payments -
ANSWER-A part of the balance of payments that
shows transfers of non-monetary and fixed assets
into and out of the economy.
Cartel - ANSWER-A group of products who collude
to limit output in order to keep prices high.
Central bank - ANSWER-The institution responsible
for issuing banknotes in an economy, acting as a
lender of last resort, and implementing monetary
policy.
Ceteris paribus - ANSWER-All other things
remaining equal
, Circular flow of income - ANSWER-The flow of
national output, income and expenditure between
firms and households.
Command economy - ANSWER-An economy where
only the government determines the allocation of
resources.
Comparative advantage - ANSWER-When the
opportunity cost of producing a good or service is
lower than that of any other country.
Competition policy - ANSWER-Government policy
aimed at reducing monopoly power in order to
increase efficiency and to ensure fairness for
consumers.
Concentration ratio - ANSWER-A measure of the
dominance of firms in a market.
Conglomerate integration - ANSWER-Where a firm
merges with or takes over a firm in a completely
different market.
Consumer surplus - ANSWER-The difference
between the price a consumer pays and the price
they were willing to pay.
